Full-year profits tumble at Jupiter

24th Feb 2023 07:03

(Sharecast News) - Jupiter Fund Management reported a slump in both assets under management and profits on Friday, after a "difficult" year for the City fund manager.

Publishing full-year results, Jupiter said assets under management had finished the year to 31 December 17% lower, at £50.2m, with total net outflows of £3.5m.

Underlying pre-tax profits tumbled to £77.6m from £216.7m, while statutory pre-tax profits fell 68% to £58m.

Matthew Beesley, Jupiter's recently installed chief executive, said the past year had "clearly been difficult", with macro-economic events hitting both investor sentiment and asset valuations.

He added that the FTSE 250 firm had had a stronger second half, however, with positive net flows for the first time since 2017.

Since taking over in October, Beesley has cut headcount and announced plans to reduce the number of funds by 25%.

Beesley said the firm would now focus on scaling up in "select geographies", decreasing "undue complexity", broadening its appeal with new investment strategies and improving relationships with stakeholders.

He added: "Although the macro-economic environment looks to set to remain uncertain in the short term, we are focused on addressing the areas that we can control and delivering on what we have promised.

"Since I was appointed, we have taken decisive action to simplify the business, deliver efficiencies and create capacity to build scale in strategically important areas."

The slide in profits was not as bad as some analysts had feared, and by 0900 GMT shares in Jupiter were ahead 12% at 149.88p.

Stuart Duncan, analyst at Peel Hunt, said: "Final results were significantly better than expected, including surprisingly positive flows in the second half. Pre-tax profits came in at £77.6m, against our estimate and consensus of £63m.

"Looking ahead, strategy is focused on increasing scale, manging costs and managing product range, with a view to diversifying client base. We will review forecasts after the meeting and expect to push higher, given AUM starting point."

Peel Hunt has a 'hold' rating on the stock and a target price of 150p.